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DECREE No

DECREE No.42-CP ON THE 8TH OF JULY 1995 OF THE GOVERNMENT PROMULGATING THE REGULATION ON LEGAL CONSULTANCY OF FOREIGN LAWYERS' ORGANIZATIONS IN VIETNAM

THE GOVERNMENT

Pursuant to the Law on Organization of the Government on the 30th of September 1992;

At the proposal of the Minister of Justice,

DECREES :

Article 1.- To promulgate together with this Decree the Regulation on Legal Consultancy by Foreign Lawyers' Organizations in Vietnam.

Article 2.- This Decree takes effect from the date of its signing. All previous provisions contrary to this Decree are hereby repealed. The Minister of Justice is responsible for guiding and supervising the implementation of this Regulation.

Article 3.- The Ministers, the Heads of ministerial-level agencies, the Heads of the agencies attached to the Government, the Presidents of the People's Committees of provinces and cities directly under the Central Government shall have to implement this Decision.

On behalf of the Government

The Prime Minister

VO VAN KIET

REGULATION ON LEGAL CONSULTANCY BY FOREIGN LAWYERS' ORGANIZATIONS IN VIETNAM

(Issued together with Decree No.42-CP on the 8th of July 1995)

Chapter I

GENERAL PROVISIONS

Article 1.- Foreign lawyers' organizations that meet all the requirements set out in this Regulation may be permitted to practice legal consultancy in Vietnam.

Article 2.- The Vietnamese Government ensures appropriate treatment to foreign lawyers' organizations engaged in legal consultancy in Vietnam according to the provisions of Vietnamese law.

Article 3.- Lawful properties of foreign lawyers' organizations engaged in legal consultancy in Vietnam shall not be nationalized or confiscated through administrative measures.

Article 4.- Foreign organizations and individuals shall not practice legal consultancy in Vietnam without authorization by the competent authorities of Vietnam as defined in this Regulation.

Article 5.- Foreign lawyers' organizations and foreign lawyers practicing legal consultancy in Vietnam must respect the independence and sovereignty of Vietnam and observe the law of Vietnam.

Chapter II

REQUIREMENTS FOR PRACTICE, FORMS OF ORGANIZING PRACTICE AND PROCEDURES OF LICENSING

Article 6.- Foreign lawyers' organizations which wish to operate in Vietnam must satisfy the following requirements :

1. Having foreign clients active in investing and business in Vietnam;

2. Having an established reputation in legal consultancy;

3. Having goodwill toward the State of Vietnam;

4. Having a business plan and committed to its obligations under this Regulation and other provisions of Vietnamese law;

5. Having the material basis necessary for their activities.

Article 7.- A lawyer operating in Vietnam who is employed by a foreign lawyers' organization has to meet the following requirements :

1. Has practiced legal consultancy for at least 5 years in a foreign lawyers' organization;

2. Not subject to penal liability, or serving a sentence, or having not yet recovered his civil rights;

3. Having goodwill toward the State of Vietnam.

Article 8.- A foreign lawyers' organization meeting the conditions under Article 6 of this Regulation may be permitted to set up branches in Vietnam.

Each foreign lawyers' organization may be permitted to set up a maximum of two branches in Vietnam.

Foreign lawyers' organizations shall be responsible for every activity of their branch(es).

Article 9.- The term of operation of the branch office of a foreign lawyers' organization in Vietnam is 5 years from the date of the license is signed, and can be extended but not for more than three years each time.

Article 10.- A foreign lawyers' organization, which wants to set up a branch in Vietnam, shall submit an application for permission. The application shall have the following main contents:

1. Full name, nationality, address of the head office of the foreign lawyers' organization;

2. Name of the branch;

3. Range of activity and fields of legal consultancy;

4. Duration of operation;

5. Proposed address of the branch;

6. Family name and first name of the foreign lawyer empowered by the foreign lawyers' organization to manage and operate the branch;

7. Number of foreign lawyers and Vietnamese staff expected to work in the branch.

Article 11.- The following documents shall be attached to the application :

1. A copy of the Statute or other necessary documents, as evidence of the lawful establishment and operation of the foreign lawyers' organization;

2. Profile of operation of the foreign lawyers' organization;

3. Financial statement for the last two years of the foreign lawyers' organization;

4. List and professional and legal resumes, and copies of the operating licenses of foreign lawyers in the branch;

5. Authorization for the foreign lawyer to manage and operate the branch;

6. Business plan of the branch;

7. List of foreign clients active in investing or operating a business in Vietnam.

Article 12.- The application shall be prepared in Vietnamese. The documents attached to the application, which are prepared and certified abroad, shall be legalized at the consulate. The documents shall be translated into Vietnamese and notarized by a Vietnamese notary public.

The following documents shall be certified by the authorized offices in the country where the head office of the foreign lawyers' organization is located :

1. A copy of the Statute or necessary documents as evidence of the lawful establishment and operation of the foreign lawyers' organization.

2. A copy of the operating license of the foreign lawyer;

3. Authorization for the foreign lawyer to manage the branch.

Article 13.- The application for the establishment of a branch of a foreign lawyers' organization and other accompanying documents shall be submitted to the Ministry of Justice. Within 60 days, inclusive of the date of receiving the full proper application and fees, the Ministry of Justice shall consider, consult the relevant offices and decide to license or refuse the application.

The license shall be made in three copies, one to be kept by the applicant, one for the People's Committee of the province or city directly under the Central Government where the office of the branch of the foreign lawyers' organization is located, and one for the file.

In case of refusal, the Ministry of Justice shall inform the applicant and state clearly the reasons.

The license takes effect from the date of its signing.

Article 14.- Within 60 days from the date of issue of the license, the branch of the foreign lawyers' organization shall register its operation at the Department of Justice in the province or city directly under the Central Government where the office is located. If the registration of operation is not made by the branch of the foreign lawyers' organization within this time limit, the license shall be invalidated, except when a plausible reason is accepted by the Ministry of Justice.

When registering its operation, the branch is required to present the license for its establishment and the documents confirming its location.

Within 15 days after receiving the full proper application, the Department of Justice shall issue the registration of operation for the branch.

The branch of the foreign lawyers' organization can begin operating only after registering.

Article 15.- Within 15 days from the date of registration, the branch of the foreign lawyers' organization shall publish an announcement in 5 successive issues of the Vietnamese press on the establishment of the branch.

Article 16.- When the branch of the foreign lawyers' organization has a need to change its name, address, representative, list of lawyers, or field of legal consultancy, it must apply to the Ministry of Justice, and shall be permitted to make the change only upon obtaining written approval from the Ministry of Justice.

Article 17.- Where the branch of the foreign lawyers' organization wishes to extend its activities, it must submit an application to the Ministry of Justice at least 60 days before the expiration of its term.

Within 30 days from receipt of the application for extension, the Ministry of Justice shall decide on the extension of the term of operation, and in case of refusal it must state clearly the reasons.

The extension of the term of operation shall be registered under the provision of Article 14 of this Regulation.

Article 18.- When submitting an application for permission to set up a branch, or to extend its term of operation, or to change the content of the license, the person concerned shall pay the fee set by the Ministry of Finance together with the Ministry of Justice.

Chapter III

SCOPE OF OPERATION, RIGHTS AND OBLIGATIONS OF THE BRANCH OF A FOREIGN LAWYERS' ORGANIZATION, OR FOREIGN LAWYERS

Article 19.- A branch of a foreign lawyers' organization shall carry out its operation according to the contents and fields listed in the license.

Article 20.- Foreign lawyers of a branch of a foreign lawyers' organization can advise about foreign law and international law only in the fields of business, investment, and commerce; not about Vietnamese law, and cannot be a participant in legal proceedings in their capacity as solicitor or representative for clients before a Vietnamese Court.

Article 21.- A branch of a foreign lawyers' organization may enter into cooperation contracts with Vietnamese legal consultancy offices on a case-by-case basis to carry out legal consultancy on Vietnamese law.

Article 22.- A branch of a foreign lawyers' organization may receive payment under agreements with the clients, and according to the level of complexity of the case, the time and the reasonable cost of consultancy.

Payment for legal consultancy of the branch of the foreign lawyers' organization must be made in Vietnam.

Article 23.- A branch of a foreign lawyers' organization shall apply the accounting and statistical systems according to the provisions of Vietnamese law on accounting and statistics, and open bank accounts in foreign and Vietnamese currencies in Vietnamese banks, and make receipts and payments through these accounts.

Article 24.- A branch of a foreign lawyers' organization may make contracts to hire service staff who are Vietnamese citizens.

The rights and obligations of those service workers working on a contractual basis in a branch of a foreign lawyers' organization shall be specified in labor contracts pursuant to the law on labor in Vietnam.

A branch of a foreign lawyers' organization shall not hire Vietnamese lawyers to work in the branch.

Article 25.- A branch of a foreign lawyers' organization is entitled to import all facilities required for the activities of its branch in Vietnam and for the working and living needs of the foreign lawyers working in the branch, according to the provisions of Vietnamese law.

Article 26.- A branch of a foreign lawyers' organization and a foreign lawyer is entitled to remit abroad the income from their practice of legal consultancy, according to the provisions of Vietnamese law.

Article 27.- A branch of a foreign lawyers' organization and a foreign lawyer shall have to strictly abide by Vietnam's regulations on the management of foreign exchange of Vietnam.

Article 28.- A branch of a foreign lawyers' organization shall have at least one foreign lawyer on duty in Vietnam, besides the foreign lawyer who is entitled to manage and operate the branch.

Article 29.- A branch of a foreign lawyers' organization is entitled to accept a Vietnamese citizen with a bachelor of law degree as a trainee on legal consultancy in the branch.

A trainee lawyer operating in the branch of a foreign lawyers' organization shall not give legal advice to a client.

The rights and obligations of a trainee lawyer practicing legal consultancy in a branch of a foreign lawyers' organization shall be stated specifically in a contract in accordance with the law on labor of Vietnam and this Regulation.

The acceptance of a trainee lawyer to practice legal consultancy must be approved by the Department of Justice of the province or city directly under the Central Government where the branch is located.

Article 30.- A branch of a foreign lawyers' organization shall have to pay compensations for any physical losses and damage incurred by a client, resulting from a mistake of a lawyer in the branch.

Article 31.- A lawyer of a branch of a foreign lawyers' organization shall be obligated to join a professional insurance scheme in Vietnam.

Article 32.- A lawyer of a foreign lawyers' organization shall practice legal consultancy in an honest and objective manner.

Article 33.- A branch of a foreign lawyers' organization and foreign lawyers are obligated to pay all taxes pursuant to the laws and regulations of Vietnam.

Article 34.- A branch of a foreign lawyers' organization shall report in writing on a six month and annual basis to the Ministry of Justice about its organization and operation. When necessary, it shall report at the request of the Ministry of Justice and the relevant authorities, according to the provisions of Vietnamese law.

Article 35.- A branch of a foreign lawyers' organization shall terminate its operation in the following circumstances :

1. The term stated in the license expires without extension.

2. The operation is voluntarily terminated.

3. The license is withdrawn.

In the event of voluntary termination, a branch of a foreign lawyers' organization shall report 60 days in advance to the Ministry of Justice about the date of termination of its operation.

Within 90 days after termination, a branch of a foreign lawyers' organization shall have to clear all debts, solve all issues related to termination, and make a written report to the Ministry of Justice and competent State authorities.

Chapter IV

STATE MANAGEMENT

Article 36.- The Ministry of Justice carries out State management of legal consultancy by foreign lawyers' organization in Vietnam, and has the following responsibilities and rights :

1. To provide guidance for foreign lawyers' organizations to fill the procedures for permission to set up branches in Vietnam;

2. To issue a license to a foreign lawyers' organization to set up a branch, and to extend the operation of a branch;

3. To guide, examine and inspect the organization and operation of a branch of a foreign lawyers' organization and of a foreign lawyer;

4. To preside over and settle all matters connected with the legal practice of foreign lawyers' organizations and foreign lawyers in Vietnam;

5. To deal with violations pursuant to the provisions in Article 42 of this Regulation.

Article 37.- For the violations committed in their locality, the People's Committee of the province or city directly under the Central Government will have the following obligations and rights:

1. To guide, examine and inspect the organization and operation of a branch of a foreign lawyers' organization;

2. To deal with violations pursuant to the provisions in Article 43 of this Regulation;

3. To ask the competent State agency to review and resolve issues concerning the organization and operation of a branch of a foreign lawyers' organization.

Article 38.- The Departments of Justice have the following responsibilities and rights :

1. To carry out the registration for operation of the branches of foreign lawyers' organizations, and the registration of extension of operation of these branches;

2. To approve the acceptance of trainees in legal consultancy in branches of foreign lawyers' organizations;

3. To exercise other management activities for legal consultancy of the branches of foreign lawyers' organizations, according to the guidance and guidelines of the Ministry of Justice and the People's Committee of provinces and cities directly under the Central Government.

Chapter V

HANDLING OF VIOLATIONS

Article 39.- Foreign organizations and individuals who are not allowed to practice legal consultancy in Vietnam shall, if they do so in any form, be fined up to 20,000 USD, and shall be forced to suspend their practice. If they relapse, they shall be fined twice the previous amount, and shall have all profits derived from their illegal legal consultancy confiscated, and be forced to terminate their practice.

Article 40.- A branch of a foreign lawyers' organization violating the provisions of this Regulation shall, depending on the extent of the violation, the following sanctions:

1. Be fined 10,000 USD for praticing legal consultancy before completing the registration;

2. Be fined 7,000 USD for practicing legal advising outside the fields listed in the license; if there is a relapse, then be suspended from practice for a term, or have the license withdrawn;

3. Be fined 5,000 USD for not observing the provisions on review and inspection by the competent State bodies; be fined twice the previous amount, and be suspended from practice for a term if they commit a second violation; and have the license withdrawn at the third violation;

4. Any breach of other provisions of this Regulation is liable to a fine of from US$ 2,000 to US$ 5,000; the second or third violation shall involve fines of twice the previous amount.

Article 41.- A foreign lawyer who violates any provision of this Regulation shall, depending on the extent of the violation, be fined up to 5,000 USD, suspended from practice for a given period, or shall be banned from practicing legal consultancy in Vietnam.

Article 42.- The Ministry of Justice has the competence to apply the following sanctions:

1. To suspend practice of a branch of a foreign lawyers' organization or a foreign lawyer for a term;

2. To withdraw the license of a branch of a foreign lawyers' organization; to ban a foreign lawyer from practicing legal consultancy;

3. To fine 5,000 USD and more.

Article 43.- The People's Committees of the provinces and cities directly under the Central Government have the competence to impose fines of less than US$ 5,000 for violations of this Regulation.

Chapter VI

IMPLEMENTATION PROVISION

Article 44.- All foreign lawyers' organizations having been permitted to set up representative offices in Vietnam within 6 months from the date of issue of this Regulation, must fill the procedures for permission to set up branches and register the practice, according to the provisions of this Regulation; past that period, if they fail to fill the procedures for permission, they shall have to terminate operation.

On behalf of the Government

The Prime Minister

VO VAN KIET